Midday Commentary: Tesla Motors lower with shares; Auxilium expands on hedge after lowered outlook

By Rebecca Melvin

New York, April 30 - Tesla Motors Inc., a typically actively traded name in the convertibles market, was a top-volume name again on Wednesday, which is the last day of the month, and the electric car maker's bonds were lower in line with their underlying shares.

The Tesla 1.25% convertibles due 2021, or the B tranche, printed at 90.4, which was down 0.637 point on the day, according to Trace data. That was up from pricing in the 89-plus range last Friday.

The Tesla 0.25% convertibles due 2019 changed hands at 92.199, which was down 0.224 point, Trace showed. Tesla shares were down about 1% at $204.00 and change in the early going Wednesday.

Auxilium Pharmaceuticals Inc.'s convertibles were lower outright, but expanded on a dollar-neutral, or hedged, basis against a 19% drop in the underlying shares of the Malvern, Pa.-based specialty pharmaceutical company. The company lowered its full-year guidance, which prompted the shares to sell off, a New York-based trader said.

Auxilium's 1.5% convertibles due 2018 were quoted 118.50 bid, 119.25 offered with the stock at about $22.50, which represented an expansion of about 0.75 point on a dollar-neutral basis, the trader said.

Otherwise there was a surprisingly light level of activity, a New York-based trader said regarding the last session of April.

"Earnings did not seem to make names that active," the trader said.

The primary market remained quiet for a third straight day this week.

In economic data, U.S. gross domestic product dropped to a rate of 0.1% growth for the first quarter, hampered by severe winter weather, and down from a 2.6% growth rate in the first quarter of 2013, the Commerce Department said.

The rate was well below consensus expectations for a 1.2% GDP gain.

Equities see-sawed between gains and losses.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.